New regulations are emerging across the U.S. and U.K. that focus on some of the more visible, day-to-day sustainability and environmental problems like waste, pollution and carbon emissions. Companies need to be informed as new policies are enacted across the globe and ensure their practices abide by these changes. Understanding which sustainability regulations apply to and influence your business is part of the responsibility that comes with being a green business.
SUSTAINABILITY REGULATIONS: WHY THEY MATTER TO YOU
Many businesses have faced instability and uncertainty over the last few years from the combined impact of shifts in power, the U.K.’s exit from the European Union, the coronavirus pandemic and social and economic hardship – all of which have led to or are pushing for new policies.
While keeping up with regulations may not be the most enjoyable part of running a company, it is critically important to do so in order to maintain legality and avoid the penalties that come from malpractice.
But regulations are more than just policies and they shouldn’t be your only reason for being a sustainable, ethical business. These lawful constructs are put in place to serve and protect the world at large and public concerns over environmental and social wellbeing are on the rise. In a 2020 Yougov survey, the environment was ranked as the fourth most pressing issue facing the U.K., just below health, the economy and Brexit. In the U.S., 64% of Americans feel that protecting the environment should be a top priority for the president and Congress while 63% believe stricter environmental regulations are worth the cost.
It’s simple: Staying informed and abiding by regulations is a demonstration of your commitment to good and ethical business, your stakeholders and the planet.
SUSTAINABILITY REGULATIONS TAKING HOLD
Here are some important sustainability regulations across the U.S. and U.K. that are worth monitoring for your success as a green business.
Competition Law and Sustainability Agreements
In January 2021, the U.K.’s Competition and Markets Authority (CMA) released guidelines to help businesses understand how to navigate sustainability agreements and achieve green goals without breaching competition law. Competition law serves to protect consumers and businesses from behavior that hinders or weakens competition which can cause inflated prices, poor quality or scarcity of products, and imbalances in market power.
The CMA’s guidelines offer clarity and detailed assistance for businesses wanting to collaborate and combine expertise to achieve sustainability; For example, making more energy efficient products or eco-friendly packaging. The CMA recognizes that such collaborations to achieve sustainability are unlikely to threaten competition and even in the event that a particular scenario doesn’t fit perfectly within the economic context, the potential environmental benefits may be weighed favorably and yield an exception.
The Organization for Economic Cooperation and Development (OECD) provides a wealth of information on the interaction between competition law and sustainability. The organization’s latest paper discusses how sustainability goals can be fostered through competition thus refuting the outdated belief that good business and environmentalism cannot coincide.
Energy Use and Carbon Emissions
As part of their Ten Point Plan, the U.K. has pledged to achieve net zero carbon emissions by 2050 and is expected to release an Energy White Paper by the end of 2021. The Plan includes advancing offshore wind and nuclear power, phasing out the sale of all new petrol and diesel cars by 2030, creating 250,000 green jobs by 2030, mobilizing potentially three times more investment from the private sector, among several other ambitious goals.
Businesses will be most impacted by the Ten Point Plan in regards to their offices and workplaces, the products they purchase, and the business models and technology they use. Point 7 “Green Buildings” will increase building standards to improve energy efficiency and low carbon heating, as well as launch a green purchasing policy framework. Point 10 “Green Finance and Innovation” looks to raise R&D investment and commercialize green technology such as disruptive artificial intelligence for energy.
Similarly, the U.S. has plans for 100% carbon neutrality by 2050 under the new Biden-Harris Administration. The nation’s recent rejoining into the Paris Climate Agreement and the cancellation of the Keystone XL pipeline permit has set the tone for new president’s Climate Plan which includes 100% carbon-free electricity by 2035, zero-carbon infrastructure, emissions-free vehicles, R&D for renewables and green tech, addressing climate threats to disadvantaged communities, among others. Millions of new jobs are expected to emerge as wind and solar, electric vehicle, high-speed rail and other green industries grow.
As the standard to hold companies accountable for their environmental impact increases, more companies will have to report on their energy usage and carbon emissions. In 2019, the U.K. launched its new Streamlined Energy and Carbon Reporting (SECR) framework that enforces mandatory energy and emissions reporting from quoted companies as well as large unquoted companies and limited liability partnerships.
High-polluting businesses are likely to have to register and collaborate with national regulators such as the U.K. Environment Agency in England and Wales, the Scottish Environment Protection Agency in Scotland and the Department of Agriculture, Environment and Rural Affairs in Northern Ireland. The U.K. Department of Environment, Food and Rural Affairs provides a user guide specifically for small businesses to measure and report their GHG emissions.
The U.S. Environmental Protection Agency (EPA) also provides online tools for low-emitting businesses to use for measuring and tracking their emissions. This includes a GHG emissions calculator, a GHG inventory management plan, and many emissions reduction programs and resources.
Whether you run a business from home or in a shop or warehouse, business waste is inevitable and is defined as any waste generated from commercial activities. You have various responsibilities for properly disposing of your waste such as keeping waste to a minimum, sorting and storing waste securely, separating recyclable materials from general waste, completing waste transfer notes and not allowing your waste to be disposed of illegally.
In the U.K., specific regulations apply to businesses that produce packaging or sell packaged goods, including completing a recovery and recycling obligation and submitting a certificate of compliance. Businesses also pay a landfill tax for any waste disposed of by landfill but have the opportunity to receive tax credits for recovering and recycling efforts.
Waste management policy and regulation in the U.S. is overseen by the EPA’s Resource Conservation and Recovery Act (RCRA) which provides all of its regulations for hazardous and non-hazardous waste online. There is even a small business guide for managing hazardous waste.
Energy Taxes and Incentives
The Climate Change Levy (CCL) is one of several environmental taxes and relief schemes in the U.K. In the effort to encourage energy efficiency, the CCL taxes energy (electricity, gas and solid fuels) delivered to non-domestic users with the exception of small businesses that use very little energy and charity organizations operating in non-commercial activities. Energy-intensive industries can either pay reduced rates by entering into a climate change agreement or pay Carbon Price Support rates through onsite power generation or operating a combined heat and power stations. The CCL rates were last revised in April 2020.
While a carbon tax has long been proposed in the U.S., there are many tax credits and incentives for businesses to cut their energy use and emissions such as purchasing electric vehicles, investing in renewable energy and green fuels, and making energy efficiency upgrades to your commercial building.
Regional and Local Regulations
As well as understanding your sustainability obligations under national legislation, you need to be aware of the rules and regulations specific to your region and community. The U.S. Environmental Protection Agency provides a list of regulatory agencies organized by state as well as regulations organized by business sector.
Thanks to the convenience of the internet, it is very easy to find detailed information on local policies such as where and how to properly dispose of waste. The U.K. issued the Duty of Care legislation which oversees safe management of household, commercial and industrial waste and is largely regulated by local authorities. The U.S. implements a similar model in which counties oversee local waste management and provide county-specific guidelines online.
In addition to knowing your local and regional regulations, you should also research to see if your local government, non-profits, and other organizations offer grant funding for good environmental practices. One such opportunity is Greater Manchester’s Energy Efficiency Grants for small and medium-sized businesses which awards grants of between £1,000 to £12,500 towards energy saving improvements such as lighting or equipment upgrades.
There are countless environmental grant opportunities in the U.S., too, which can be found via Grant Watch, a site dedicated to helping people and businesses find all types of local, state and federal grants.
Routinely engaging with your community and checking in on local ordinances is a great practice for staying informed on new and changing policies.
The world is calling, in both written policy and public outcry, for companies to take accountability for their actions and make a commitment to better practices. One such practice is to simply stay informed about the sustainability regulations that affect your business and learn how to both navigate them and use them as a supportive framework for guiding your green goals.
About the Author
Charlotte Murphy is a freelance writer who advocates for waste-free living. She enjoys writing about the applications of sustainability within business and how small changes can create a big impact. When she isn’t writing, Charlotte can be found in the kitchen recreating Chinese fake-away dishes or walking in the local park with her cocker spaniel Ringo.